Long-term debt


Notes to Financial Statements

NOTE 10 — DEBT

As of September 30, 2013, we had $15.9 billion of issued and outstanding debt, comprising $1.3 billion of commercial paper and $14.6 billion of long-term debt, including the current portion.

Short-term Debt

As of September 30, 2013, we had $1.3 billion of commercial paper issued and outstanding, with a weighted-average interest rate of 0.10% and maturities of 70 to 98 days. The estimated fair value of this commercial paper approximates its carrying value.

In June 2013, we entered into a $1.3 billion credit facility, which serves as a back-up for our commercial paper. As of September 30, 2013, we were in compliance with the only financial covenant in the credit agreement, which requires us to maintain a coverage ratio of at least three times earnings before interest, taxes, depreciation, and amortization to interest expense, as defined in the credit agreement. The credit facility expires on June 24, 2018. No amounts were drawn against the credit facility since its inception.

 

Long-term Debt

As of September 30, 2013, the total carrying value and estimated fair value of our long-term debt, including the current portion, were $14.6 billion and $14.5 billion, respectively. This is compared to a carrying value and estimated fair value of $15.6 billion and $15.8 billion, respectively, as of June 30, 2013. These estimated fair values are based on Level 2 inputs.

The components of our long-term debt, including the current portion, and the associated interest rates were as follows as of September 30, 2013 and June 30, 2013:

 

Due Date  

Face Value

September 30,

2013

   

Face Value

June 30,
2013

   

Stated
Interest

Rate

    

Effective
Interest

Rate

 


          (In millions)               
Notes                               

September 27, 2013

           $            0      $ 1,000        0.875%         1.000%   

June 1, 2014

            2,000        2,000        2.950%         3.049%   

September 25, 2015

            1,750        1,750        1.625%         1.795%   

February 8, 2016

            750        750        2.500%         2.642%   

November 15, 2017

            600        600        0.875%         1.084%   

May 1, 2018

            450        450        1.000%         1.106%   

June 1, 2019

            1,000        1,000        4.200%         4.379%   

October 1, 2020

            1,000        1,000        3.000%         3.137%   

February 8, 2021

            500        500        4.000%         4.082%   

November 15, 2022

            750        750        2.125%         2.239%   

May 1, 2023

            1,000        1,000        2.375%         2.465%   

May 2, 2033 (a)

            745        715        2.625%         2.690%   

June 1, 2039

            750        750        5.200%         5.240%   

October 1, 2040

            1,000        1,000        4.500%         4.567%   

February 8, 2041

            1,000        1,000        5.300%         5.361%   

November 15, 2042

            900        900        3.500%         3.571%   

May 1, 2043

            500        500        3.750%         3.829%   


                

Total

          $   14,695      $   15,665                    
           


 


                

 

(a)

In April 2013, we issued €550 million of debt securities.

The notes are senior unsecured obligations and rank equally with our other unsecured and unsubordinated debt outstanding. Interest on the notes is paid semi-annually, except for the euro-denominated debt securities on which interest is paid annually. As of September 30, 2013 and June 30, 2013, the aggregate unamortized discount for our long-term debt, including the current portion, was $63 million and $65 million, respectively.